A MULTI-MILLION pound deal has staved off any fears of job losses at a Crewe engineering firm.

Vickers Specialist Engines, which is part of Rolls-Royce Plc and based at Sunnybank Road, has landed a £20m contract with the Ministry of Defence to maintain engines for the Royal Navy's Hunt class warships.

It is good news for the firm at a time when other engineering companies in Crewe, including Vickers Precision Engineering and Rolls-Royce and Bentley Plc, have been forced to cut jobs and hours.

The cutbacks have been a reaction to the terrorist attacks in the US and the knock-on effect of their damage to consumer confidence.

The first phase of the contract will cover the repair and overhaul of Deltic engines and spares for a period of three years.

The second part of the Vickers Specialist Engines (V-SE) deal covers the provision of power for the Deltic engines, managed by V-SE.

It is anticipated the contract will ultimately be extended for the running life of the vessels.

The Crewe firm already works with both the Navy and the Army, providing a generator which is invisible to enemy radar.

Managing director Jim Vickerman said: 'This contract is the most progressive that we have entered into and as such provides testimony to the growing capabilities of V-SE.'

The company, which has a 95-strong workforce, won the contract through months of negotiations after being named as the MoD's preferred bidder last year.

It had already invested heavily at ways of improving the future reliability and cost-effectiveness of the Deltic engine.

The company has an annual turnover of about £10m.

Although better known for work in aviation, Rolls-Royce plc is the global leader in marine power systems and supplies propulsion to more than 30 navies worldwide.